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Greece is sliding toward what most observers see as an inevitable default.Angelos Tzortzinis/Bloomberg News

Major customers and partners of European banks are scrambling to cut their exposure as the region's economic and financial landscape deteriorates.

Fears of contagion are triggering defensive moves by big lenders and companies, worried that Europe's banks will be savaged by the sovereign debt crisis, and at the same time sparking demands by an increasingly strident global community.

Bank of Canada Governor Mark Carney joined the chorus Tuesday, calling for an international plan to buttress European banks. Many of them are already facing sharply higher costs of capital, eroding deposits and impeded access to vital interbank loan, credit swaps and other markets.

Siemens AG, the German industrial powerhouse, pulled more than €500-million ($680-million) in deposits out of a French bank earlier this month and moved the cash to the safety of the European Central Bank, according to a Financial Times report. Siemens can make such a move because it obtained a banking licence last year as a safeguard against another financial crisis.

And the Bank of China has stopped trading in swaps and foreign exchange forwards with four major banks – Société Générale SA, BNP Paribas SA and Crédit Agricole SA of France and scandal-plagued Swiss heavyweight UBS AG – a Reuters report said. And other banks and money-market funds have been reducing their risk exposure in light of Greece's slide toward what most observers see as an inevitable default.

"We need to ask if Seimens and Bank of China are doing reasonable risk assessment, in which case we should be very worried," said Nicolas Véron, a senior fellow at Bruegel, a Brussels think tank, who specializes in European banking issues. "Or are they overreacting to market overreach? I will say this: Europe's leaders have not done an excellent job of making the case that this is unwarranted."

If other banks and customers take similar actions to protect themselves from the risks of contagion, European banks will find their costs of capital rising even more sharply and their financial health, already damaged by the slumping regional economy, will become increasingly precarious. That, in turn, could lead to a worldwide credit squeeze of the kind that triggered the 2008 global financial crisis.

The International Monetary Fund warned that European banks must shore up their capital before the storms worsen.

The IMF said in its latest temperature reading of global economic conditions that European banks have to add capital in excess of new minimum global standards, which themselves do not take effect until 2019.

New IMF managing director Christine Lagarde warned last month that banks "need urgent recapitalization" to withstand the sovereign debt risks and the damage stemming from the faltering economy.

"This is key to cutting the chains of contagion," the former French finance minister said. "If it is not addressed, we could easily see the further spread of economic weakness to core countries, or even a debilitating liquidity crisis."

Now, she has been joined on the worry line by the European Union's competition commissioner, Joaquin Almunia, the first senior European bureaucrat to warn publicly that more than just the banks that failed stress tests in July will be in need of urgent capital infusions if the debt crisis drags on much longer.

"The worsening of the sovereign-debt crisis, its impact on a fragile banking system and the continuing tensions in funding markets all point to the possible need for further recapitalization," Mr. Almunia told reporters.

Longer term, euro zone banks need to be "decoupled" from their national governments and placed under region-wide supervision, Mr. Véron said. "It's not about centralizing everything, but making sure that there is some consistency [among banks in different countries] Which doesn't exist now, as the stress tests have illustrated."

All banks in the EU had to submit to the tests, which measured their capacity to withstand new shocks to their balance sheets. But there were no uniform methods for disclosure or application of the tests, or for instructing banks on how to recapitalize, or restructuring those that cannot do so on their own.

Nine banks failed the July tests, and another 16 passed by the slimmest of margins. They face a mid-October deadline to show the EU's regulator how they intend to address their capital shortfall.

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